The Italian red carpet favorite is the latest label to be picked off by a conglomerate after years of expansion by European groups like Louis Vuitton owner LVMH, which now has a stable of 70 brands from champagne to watchmakers.

But growing cash piles at LVMH and its Paris rival Kering , the emergence of aspiring conglomerates like U.S.-based Kors or China's Shandong Ruyi and a widening gulf between performing brands and those straining to catch up could propel more deals, some industry watchers said.

"Compared to the bigger brands, standalone groups lack the needed oxygen. Consolidation is inevitable," said Giuliano Noci, professor of strategy and marketing at Milan's Politecnico School of Management.

The industry still boasts some big name, independent successes, like France's Hermes or privately-owned Chanel. The latter, long lusted after by rivals, revealed this year it was roughly neck-and-neck with Louis Vuitton as one of the biggest luxury labels by sales.

In Italy, luxury puffer jacket maker Moncler is riding high thanks to a strategy of constantly changing designs and investments in e-commerce.

But in a fickle industry where trends come and go, and demand can take a sudden hit as tourists flows drop for instance, conglomerates have been among the stronger performers recently amid booming demand from Chinese consumers.

Revenues at Kering and LVMH have thrived thanks to their respective Gucci and Vuitton labels, helping them to offset blips at others like Bottega Veneta or Marc Jacobs.

By contrast, Britain's Burberry, Italy's Salvatore Ferragamo or U.S. jeweler Tiffany were more glaringly exposed when their sales momentum faltered.

These three are working through turnaround plans, but are often cited by analysts as potential acquisition targets, even though Ferragamo is one of a handful of Italian family-controlled firms like Prada where the owners have long resisted ceding control.

"For family-owned groups it is more painful to reach these types of decisions. But if you have a period of prolonged underperformance, and this continues, eventually you've got to do something," said Flavio Cereda, an analyst at Jefferies, adding that he expected more deals in the coming years.

Versace joins Bulgari as an example of family-run businesses that eventually sold. LVMH bought the Italian jeweler in 2011.

One caveat is that Kering and LVMH are unlikely to want to take on brands that need too much fixing, investment bankers said. Kering is among groups that passed on Versace, where profitability has faltered, sources familiar with the matter said on Monday.

The two French groups, which also rival Switzerland's Richemont, owner of Cartier, have often said they are open to opportunities, though LVMH said recently that asset prices were high. They had no comment on Tuesday on their acquisition plans.

Other contenders are emerging, however. China's Shandong brought Swiss shoe brand Bally this year, and rival Fosun snapped up French couture house Lanvin, with the two outlining ambitions to break into luxury.

In the United States, Michael Kors, to be renamed Capri Holdings, is a rival of Tapestry, the owner of Coach that bought handbag maker Kate Spade last year.

For conglomerates, accumulating brands can bring savings and advantages.

"Of course there are synergies, and the bigger the group the more bargaining power with suppliers and landlords for example," said Ludovic Grandchamp of Savigny Partners, an advisory firm focused on the retail sector.